Plant Profile

When West Hawaii Concrete was threatened with possible closure, a non-traditional revenue stream kept it open and in the black.

by Tina Grady Barbaccia, News/Digital Editor

When demand for construction materials slowed, West Hawaii Concrete was faced with shutting down one of its quarries. But that wouldn’t solve the operation’s woes. The site’s lease stipulated that minimum royalty payments would still need to be made, so the quarry not only wouldn’t bring in any revenue, but it would be operating in the red even after a shutdown.

The operation’s management team quickly brainstormed and came up with a non-conventional method of generating revenue: It established a green-waste disposal venture. This entrepreneurism not only saved the quarry and has kept it operating in the black, but it has filled a landscaping service need while diverting waste from the local landfill.

“This has enabled us to keep the quarry open,” explains Jason Macy, vice president of Kona, The Big Island, Hawaii-based West Hawaii Concrete (WHC), a subsidiary of Knife River Corp., part of MDU Resources Group. “At this particular operation, the volumes had fallen to a level where it wasn’t worth having the quarry open.”

How it all began

It all started when Puna Certified Nursery, a landscaping business, approached WHC about setting up a base operation in the quarry. The landscaper had been diverting all of its green waste to a landfill. “But then they approached us about composting their waste — grass, palm trees, palm fronds, and other green waste,” Macy says. It turned out that zoning allowed composting on the property, so West Hawaii applied for a waste/green waste permit, and a green waste disposal business was born.

Green waste that will soon be turned to mulch is dumped at West Hawaii Concrete in Waikoloa, The Big Island, Hawaii.

The permitting process took about six months to complete. Once the state of Hawaii granted WHC a permit, it began collecting material in the spring of 2009 and is able to take in 3,000 tons of green waste per year to be composted. The process takes about six months for full degradation of the material. However, the permit requires that once the material is composted and broken down, nothing may be taken off of the property that is more than 3/4 of an inch in size. “If you have a 3-foot tree trunk, then it reclassifies it [the permit],” Macy says. “They [the state] want it small enough so it’s biodegradable to make sure it’s not going to end up in someone’s yard as a waste product. There are a lot of restrictions on what we can and cannot do. We told our tenant that they could compost, but that they had to abide by the rules. We gave them the list of regulations they had to meet and are ensuring they are complying with the permit.”

Currently, WHC only allows Puna Certified Nursery to compost at WHC. “We haven’t opened it up to any other contractors,” Macy says. “Because we are limited to 3,000 tons of green waste per year, we didn’t have to limit Puna’s operations until we have a better idea of what we are bringing in, especially because this contractor is willing to do the composting itself.”

WHC currently charges $40 per ton to bring in Puna’s waste, but is considering giving the company a credit for what it brings in because it does do self composting. “If we were to expand and allow another contractor in at the same price, it wouldn’t be fair,” Macy points out. Currently, WHC has not processed any green waste; it has only taken it in.

To date, it has invoiced for about $72,000 since 2009.

How it all stacks up

West Hawaii Concrete’s Waikoloa quarry currently does not have any full-time employees. When the operation went inactive, the scale operator position was eliminated because it now can be accessed remotely from its other affiliated quarries. However, Macy says the operation still sells about 20,000 to 30,000 tons of material per year at the location and contract crushes about 250,000 tons per year. Overall aggregates operations — which include the Kona Quarry at 200,000 tons per year, Waimea Quarry at 100,000 tons per year, and the Waimea Cinder Pit at nearly 30,000 tons per year, equal nearly $8.5 million.

(Top) Fine white sand blankets segments of the operation at West Hawaii Concrete. (Bottom) Kemp Murakami, general manager for maintenance for Puna Certified Nursery, checks the temperature of a pile of mulch.

“We open [the Waikoloa Quarry] on an as-needed basis,” he says. “If rock sales justify opening it for a day, the location brings in a loader operator. We took a group of our tractor-trailer delivery guys and trained them on MSHA (the Mine Safety and Health Administration) Part 46 so they were certified to run loaders. If we need them, they load [the material] themselves, get scaled out, and make the delivery from there.”

Macy says WHC hopes to expand the green waste disposal system. “We didn’t get any opposition from the community, and we think it’s a good thing to be able to divert that trash from going into a landfill.”

The green waste comes from various sites at which the contractor, Puna, has worked. “It’s then brought to the Waikoloa site and ‘scaled‘’ — i.e. checked — to ensure there isn’t any outside rubbish in it. Anything contained in the waste must be green or wooded, Macy notes. Once the green waste has been analyzed and picked through, it is then stockpiled in windrows 4 feet wide by 12 feet high.

“You get green waste coming in every day and you begin making a windrow,” Macy says. “Every week, that windrow is turned so decomposition can start. Sprinklers are turned on to keep the waste wet.”

This decomposition process, however, comes with its own hurdles. “It’s challenging because we are in a very arid area, and the amount of water we have to use is substantial,” explains Geoy Purdy, aggregate division manager for WHC. “We found this out after we got into the green waste business.” Fortunately, Purdy says, no wastewater is created, so this potential environmental headache isn’t an issue. “You just sprinkle the water on light enough so it will help decompose the material,” he says. “This is why it’s so important to make sure there isn’t foreign trash in what’s coming in.”

Each month, a new windrow is created so 11 to 12 windrows are created through the year. Each row is more decomposed than the next. Wooded shrubbery is placed in its own windrow because it decomposes at a slower rate. After the wooded green waste decomposes, it is run through a grater or grizzly screen to remove larger material, returned to another windrow, and turned once per week.

“After we screen it, we take the final product and mix it with cinder and sell it as mineral-rich soil,” Macy explains.

Currently, Puna is using the soil for its own mulching needs, but Macy says WHC plans to blend it with WHC’s own soil and get a premium for the soil. At Aggregates Manager press time, Macy says plans were to begin selling the soil at a premium in about six months. “This would create yet a whole new revenue stream,” he says.

Reducing waste, building stewardship

Ned Pettit, corporate environmental manager with Knife River Corp., is “extremely pleased” with the WHC management team’s entrepreneurism. Pettit says the idea is not only innovative, but it also reinforces Knife River’s commitment to sustainability, environmental stewardship, and good corporate citizenship.

“It fits well not only with Knife River’s environmental commitment, but our quarry operation generates sales, and the project showcases our dedication to the local community,” Pettit says. “Giving back to the communities in which we operate is a core business commitment at Knife River.”

In a global economy challenged by evolving sustainability metrics, it’s essential to be proactive, Pettit says. This means asking the question, “How can we minimize our environmental footprint and remain a competitive supplier of top-quality construction materials?”

The WHC project addresses this question. “The composting initiative has reduced waste — we are diverting what would otherwise be a waste management issue,” Petit says. “It has freed up valuable landfill space and created an innovative product that holds both economic and environmental value for our communities.”

He adds that the WHC project “champions the notions of pollution prevention, waste minimization, material re-use and recycling, while producing an environmentally advantageous resource with benefits ranging from soil enrichment to site remediation. Compost is gaining such popularity that many state transportation agencies are now incorporating its use into their bid specifications.”

Staying in the green

Although still in its early stages, the composting program has been successful so far. And in keeping with green initiatives, Purdy and Macy have already begun working on their next green innovation. It won’t create a revenue stream, but it is in keeping with environmental stewardship and being a good neighbor.

The office trailer at the Waimea location has been converted to be 100-percent solar powered. “Because it’s a remote operation, we began operating off of a remote generator,” Macy explains. “Now, we keep the generator off all of the time and just operate off of solar power. We are looking at implementing this at all the other company operations.”

A Quick Look at Knife River

Knife River, a wholly owned subsidiary of MDU Resources Group and the parent company of West Hawaii Concrete, is one of the top 10 aggregate, ready-mix, and sand and gravel producers in the nation. It is the ninth-largest U.S. aggregate producer, ninth-largest U.S. ready-mix producer, and the sixth-largest sand and gravel producer. During peak construction season, the company employs more than 5,000 people. According to the company, “We are sitting on a foundation of more than 1.1 billion tons of aggregate and provide a wide variety of products and services necessary for building America’s infrastructure.”

Since purchasing the first aggregate company in 1992, Knife River says it has become one of the fastest-growing aggregate and construction companies in the central, southern, and western United States. The corporation has acquired nearly 70 companies located in 14 states and is licensed to perform work in many more. Its core business lines include aggregate, asphalt, ready-mix concrete, liquid asphalt, and cement.